Vandoorne is to partner Spain's double world champion Fernando Alonso.
"Forget the word 'retirement'," team head Ron Dennis said of the 36-year-old Button, who won his title with Brawn GP, at the Italian Grand Prix. "That is not in the vocabulary, that is not what we are saying.
"Jenson is one of the team's drivers for the next two years and if Jenson is needed to drive next year for any reason, he will drive."
Button, the most experienced performer on the starting grid who made his debut with Williams in 2000, told reporters he decided over the August break he wanted a change.
He said he started negotiations with Dennis at last weekend's Belgian Grand Prix and agreed a two-year deal that would see him step back in 2017 and possibly return the following season.
"Next year I will be an ambassador for this team," explained Button. "I will work with this team in every way I can to make it a better team for the future...I will also be doing a lot of stuff I haven't done for 17 years.
FAMILY AND FRIENDS
"I'll be living on my schedule, I'll get up when I want, I'll do what I want for a lot of the days of the year, spend more time with my friends and family...there are many things I want to do.
"And in 2018 the team have an option on me to race for McLaren-Honda. Which is pretty awesome," said Button.
Whether he returns is likely to depend on Alonso's desire to continue with a team that has not won a race since 2012 and has under-performed since they started a new partnership with Honda last season.
By retaining Button, McLaren also have insurance in case Alonso decides to quit before the end of next season.
Vandoorne is a rising talent in the sport, a GP2 title winner who McLaren have invested in and did not want to let slip through their fingers.
He has scored a point already on a one-off appearance in Bahrain, after Alonso was injured in the Australian season-opener, and has been chafing at having to watch from the sidelines.
"It's something I have been dreaming about since I was a kid," said Vandoorne.
(Editing by Tony Jimenez)
